“In my time in that three years (2010-2013) when I held a little power, six of Australia’s ten richest people came and knocked on my door. They came looking for me, I didn’t look for them.
They are crawling all over our democracy, and my worry is unless the audience is onto this and starts to respond to it, we are allowing democracy to be privatised.
Reform will not happen in Australia’s interests, it will happen in the interests of a select few.”
– Rob Oakeshott, Independent Member of the House of Representatives for Lyne (2008-2013), on Radio National’s “Big Ideas” 7 August 2014.
Thanks to Bryan Kavanagh for the quote that has summed up the feeling one senses for those following the ICAC hearings, where another two politicians have fallen on their sword. Predictably, the property lobby was lurking in the background.
The key element behind corruption is the pursuit of economic rent, the easy money that owners of natural monopolies can make in their sleep. If government’s choose to leave this naturally rising value on the table for the taking, it will lead to such rent-seeking.
Michael Hudson has been prominent in reminding people of the rentier concept. His Insider’s Economic Dictionary details it as:
Rentier: Someone living on a fixed income, such as the French rentes, government bonds. What Keynes called a “functionless investor” in his recommendation for “euthanasia of the rentier” (General Theory, p. 376 1961 Papermacs edition, MacMillan & Company). Property rents and interest are the two major modern forms of rentier income.
Rentier income: The essence of classical political economy was that no outlay of living or embodied labor is needed to obtain rent and interest. This analysis offended the vested interests, which sponsored a post-classical reaction by applying the maxim, “If the eye offend thee, pluck it out.” The ensuing marginal utility theory ignored the wealth addiction that historically has gone hand in hand with rentiers and the tendency for their compound interest demands to approach infinity.
The great tragedy of the modern era is that politicians have to pawn their policies to pay for advertising on what was once known as the public airwaves. Some countries such as New Zealand limit political advertising on the airwaves to what the public purse covers. However, this still costs the public.
A fairer system would see the government include in all radio & TV licensing the requirement for broadcasters to provide a set percentage of time per political party per election in return for their right to enclose the electromagnetic commons. Read more in the Total Resource Rents of Australia – Harnessing the Power of Monopoly.
Sound sensible? Listen to my weekly podcast – the Renegade Economists – for more.
Until the general public can call politicians to account on their inability to address this deep issue, the world of corruption will continue. Try these 3 terms.